Bond yields traded lower on Wednesday as sentiments got boost after Finance Minister Arun Jaitley promised investors to resolve their tax concerns and reassured an increasingly skeptical business community that Asia’s third-largest economy can withstand global market turbulence and China’s slowdown. Traders are also getting some support with Organisation for Economic Cooperation and Development (OECD) statement that India is expected to see “firming growth” while the outlook for China continues to deteriorate.
In the global market, U.S. Treasury yields rose on Tuesday as investors prepared for the possibility that the Federal Reserve will increase interest rates next week for the first time in almost a decade, and as the Treasury sells $58 billion in new supply this week. Furthermore, Crude oil prices rose on Wednesday as Asian stock markets caught a tailwind from a strong performance in the United States and Europe, although fuel markets remained generally dogged by oversupply.
Back home, the yields on new 10 year Government Stock were trading 2 basis points lower at 7.75% from its previous close at 7.77% on Tuesday.
The benchmark five year yields were trading 1 basis point lower at 7.89% from its previous close at 7.90% on Tuesday